The Siam Cement Public Company Limited (SET: SCC) is poised for a steady earnings recovery, underpinned by improvements across its diverse business segments, according to a recent research note from Globlex Securities.
The initial phase of this recovery is expected to be driven by stronger earnings from subsidiaries such as SCGP, SCGD, and SJWD, as well as SCC’s core operations in cement, construction materials, and chemicals. However, the company’s LSP chemical unit will be the most crucial in this turnaround, Globlex highlighted.
LSP is anticipated to continue posting narrower losses through 2026-27, a period which precedes a major strategic shift. In the fourth quarter of 2027, SCC is scheduled to begin importing ethane feedstock—a move seen as pivotal due to the ethane’s lower cost of roughly $200 per tonne compared to the current naphtha feedstock, which is considered uncompetitive. This transition is expected to be the turning point for LSP, positioning it as a future profit driver for the group.
Following a significant net loss of THB 4.5 billion in 4Q25, the outlook for SCC’s chemical business is gradually brightening. This improvement is supported by ongoing cost reductions as part of SCC’s restructuring initiative and improving net profits from its MOC/ROC units in Thailand, which are expected to help offset the persistent quarterly net losses at LSP. Notably, LSP’s sales volume is forecast to increase from 327,000 tonnes in 4Q25 to between 400,000 and 500,000 tonnes per quarter in 2026, further aiding the recovery.
SCC’s financial performance in 4Q25 reflected a net loss of THB 3.7 billion, a significant deterioration compared to previous quarters and years (down 452% quarter-on-quarter and 620% year-on-year). This loss stemmed mainly from non-recurring charges, including a THB 1.12 billion inventory loss, a THB 1.8 billion impairment related to Noc Noc, and restructuring expenses totaling THB 1.4 billion.
Stripping out the one-offs, SCC’s core net loss for the quarter was THB 79 million—a sequential decline from a net profit of THB 774 million in 3Q25 but a marked improvement from the THB 1.6 billion net loss recorded in 4Q24. Revenues improved modestly to THB 127 billion (up 3% both quarter-on-quarter and year-on-year), with increased sales volumes offsetting lower petrochemical selling prices.
Looking ahead to 2026 and 2027, Globlex expects a gradual rebound in petrochemical prices, underpinned by strengthening demand and ongoing capacity reductions in the sector, which should help address persistent oversupply challenges. Oil prices are projected to remain within a $65–75 per barrel range, thereby stabilizing feedstock costs. Additionally, cement demand is likely to improve after the Thai general election, offering another tailwind to SCC’s key segments.
Importantly, 2028 is seen as a critical juncture for SCC, as the firm prepares to capitalize on the commencement of ethane imports for LSP—a shift to transform LSP into a profitable growth engine. In the interim, SCC’s decision to reduce its stake in the loss-making Chandra Asri unit from 30.57% to 20% is expected to strengthen the company’s balance sheet. This strategic move should improve SCC’s net debt-to-EBITDA ratio to around 3.0x, enhancing overall financial flexibility and easing the company’s interest burden.
Given these factors, Globlex reiterates its “Buy” rating on SCC, maintaining a sum-of-the-parts (SoTP) based target price of THB252. The recommendation is underpinned by SCC’s improving cyclical fundamentals, prudent capital management, recovering margins, and the group’s relentless focus on operational efficiency and cost discipline—all of which bolster prospects for sustainable earnings growth.
